Growing Income Inequality Rooted in Political Corruption

by Mike McCabe, Executive Director

May 5, 2011

We have reached a point in time when the richest 1 percent of Americans have more wealth than the bottom 95 percent combined, a sad truth verified in 2009 by PolitiFact.com. The 400 richest Americans have a bigger net worth than half of all Americans collectively, another harrowing statistic confirmed by PolitiFact earlier this year.

Such a grotesque redistribution of wealth from the many to a privileged few is inconsistent with any legitimate notion of economic justice, not to mention incompatible with democracy.

This condition is the product of a long series of deliberate policy decisions flowing from a corrupted political process. It also in turn reinforces the establishment of plutocracy – government of, by and for the wealthy.

If we were founding a nation today and had the nerve to embark on a journey leading to the creation of a democracy, there is no way we would fashion a system of paying for elections that even remotely resembles what we have now. Which is legal bribery resulting in the sale of government to the highest bidder. And the exclusion of everyone except those who are independently wealthy or willing to take out a second mortgage on their soul from the pursuit of most public offices.

But here we are, 235 years into the American experiment, and that’s exactly where we are stuck.

In Wisconsin, less than 1 percent of the population pays for all the election campaigning by state politicians. After buying the elections, that tiny fraction of our society ends up owning our government. These elites are then rewarded with what amounts to “wealthfare” payments – tax breaks, pork barrel spending, patronage jobs, no-bid contracts for state government work and other special benefits – at our expense.

It doesn’t have to be this way. We are better than this.

Few inside the Capitol, where so many are so heavily invested in the status quo, are recommending any cures for what ails our democracy. If we’re looking for ideas on how to get us to a better place and the inspiration to make it happen, we’d best look in the mirror.

To that end, the Wisconsin Democracy Campaign has put forward a new campaign reform plan called Ending Wealthfare As We Know It that aims to replace big-money plutocracy with a small-dollar democracy. It tackles legal bribery by sharply lowering limits on the size of allowable campaign contributions to candidates for state office. It further attacks the wealthfare system by creating strong incentives for candidates to seek support from the communities they will represent if elected rather than outside interests, and by incentivizing greater participation by small donors who live where the candidates are running.

The centerpieces of Ending Wealthfare are a public matching program for small-dollar political donations, a tax credit for small contributions, significantly tighter limits on campaign giving and far greater disclosure and accountability for outside interest groups.

The cost of Ending Wealthfare is $10 a year for each Wisconsin taxpayer, leaving each of us with questions to answer. Is putting an end to legal bribery in state politics worth ten bucks a year? Is it worth ten bucks to have a voice at the Capitol? Is that too much to pay to have a democracy?

WDC Executive Director Mike McCabe
Mike McCabe
WDC Executive Director
2000-2014

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